Last month, the U.S. Department of Justice (DOJ) filed an antitrust lawsuit against big tech company Apple for violating antitrust laws monopolizing the smartphone market, and undermining competition. Antitrust laws are enacted to restrict and prohibit monopolies, aiming to protect consumers from low-quality services resulting from monopolistic practices and to ensure the freedom of action for competing firms. Last February, the EU imposed on Apple a fine of 1.8 billion euros for its ‘music distribution monopoly,’ and now Apple is facing another antitrust issue. Because of this dispute, Apple’s stock is down more than 4 percent.

▲ U.S. Attorney General Merrick Garland filed an antitrust lawsuit against Apple in Washington, D.C. on March 21 local time. (Photo from AP Yonhap News)

   The DOJ has characterized the following issues as monopolization.

Limited Compatibility with Other Devices

iPhones are designed to work only with Apple Watches, limiting the functionality of other smartwatches and preventing their use. Similarly, by not allowing Apple Watches to be used with Android phones, users are locked into the Apple ecosystem.

Restrictions on Using Alternative Digital Wallets

Apple Pay prevents other banking apps from utilizing NFC functionality and also prohibits the development of digital wallets that can be used across both iOS and Android platforms.

Closed Management of iMessage

When iPhone users send a message to each other, it is indicated in a green bubble. And if you don’t use an iPhone, you cannot use its additional functions like video calls even with iPhone users. The DOJ mentioned that such discrimination keeps American teenagers from using non-Apple devices. Even Android released an app for its users to use iMessage named Beeper Mini, but Apple blocked its use.

Limited Super Apps and Cloud Gaming Services

Unlike single-purpose apps, super apps provide not only financial services but also various lifestyle services such as food delivery and ticket reservations through a single integrated interface. Apple has blocked this for a long time. Restrictions on cloud gaming services provided through the cloud without downloading games were also cited as a problem. The DOJ expressed that restricting cloud gaming services is a strategy to ensure that only high-priced smartphones are used, not low-priced smartphones. This is because people can play games even on smartphones with low performance through cloud services. Apple only recently allowed cloud gaming services.

▲ The DOJ sued Apple for violating the antitrust law. (Photo from GSMArena)

   The DOJ showed that Apple occupies 70 percent of the American smartphone market. However, Apple countered that this is because consumers are satisfied with Apple’s products. Also, they said their closed management is to protect users’ personal information and security. As customers have also filed a class action lawsuit claiming that they have been harmed by discrimination due to this system, it is necessary to pay attention to the U.S. court’s decision on this.